Our analysis is based on comparing Peoples Bancorp of North Carolina, Inc. with the following peers – First Bancorp, First South Bancorp, Inc., Carolina Trust BancShares, Inc., First Citizens BancShares, Inc. Class A and BNC Bancorp (FBNC-US, FSBK-US, CART-US, FCNCA-US and BNCN-US).

Peoples Bancorp of North Carolina, Inc.’s dividend yield is 1.97 percent and its dividend payout is 26.09 percent. This compares to a peer median dividend yield of 0.91 percent and a payout level of 16.03 percent. This type of dividend performance might make it a good stock for dividend investors. In addition, the company’s relatively good dividend quality score of 67 out of a possible score of 100 points to some sustainability of its robust payout ratio, and underscores its attractiveness for dividend investors seeking current income.

Dividend Quality Overview

Over the last twelve months (prior to March 31, 2017), PEBK-US paid a medium quality dividend, which represents a yield of 1.53% at the current price.

Dividend quality trend has not been consistent over the last five years. Dividends were paid during each of these years — of these 2 were high quality, 2 were medium quality and 1 was low quality.

The ending cash balance, with a dividend coverage of 23.95x, provides a substantial cushion in case of a significant reduction of cash flows in the future.

Dividend Coverage

Over the last twelve months (prior to March 31, 2017), PEBK-US paid a medium quality dividend.

The source of the company’s cash to support the dividend paid over the last twelve months is operating cash flow (coverage of 5.54x), investing cash flow (coverage of -15.27x), issuance cash flow (coverage of 15.50x) and twelve-month prior cash (coverage of 19.67x), for a total dividend coverage of 24.95x.

PEBK-US‘s issuance cash flow includes outflows from net debt repayment (coverage of -7.51x) and net share buybacks (coverage of -0.86x). Thus, the total coverage including share buybacks is 25.81x, which reflects our assumption that the cash paid for share buybacks is discretionary and could instead be used to pay dividends.

These coverage ratio factors imply that the firm’s net cash inflow from issuance was required (in addition to operating and investment cash) to pay the dividend, which suggests a medium dividend quality.

Dividend History

Item

2012-12-31

2013-12-31

2014-12-31

2015-12-31

2016-12-31

Latest

Dividend Yield (%)

1.96

0.85

1.01

1.48

1.55

1.97

Dividend Payout (%)

20.93

11.21

10.84

16.28

23.03

26.09

A complete list of metrics and analysis is available on the company page.

Company Profile

Peoples Bancorp of North Carolina, Inc. is a holding company of the Peoples Bank, which engages in the provision of full suite of commercial and personal banking products and services, including personal banking, business banking, online banking, mobile banking, personal loans, business loans, treasury management, and wealth management services. It has no operations and conducts no business of its own other than owning the bank. The company was founded in 1999 and is headquartered in Newton, NC.

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